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Five Things You Need to Know to Start Your Day

Five Things You Need to Know to Start Your Day

(Bloomberg) --

Good morning. The pound slid on the U.K. prime minister’s latest Brexit update, U.S. shares hit a record high, Boeing Co.’s 737 Max crisis is deepening and strikes in France aren’t going away. Here’s what’s moving markets.

Pound Slides

The pound slumped after U.K. Prime Minister Boris Johnson moved to change the law to guarantee the Brexit transition phase isn’t extended beyond the end of next year, reviving the threat that the country could leave the European Union without an agreement. Earlier on Monday, sterling erased a gain after data showed U.K. manufacturing in December suffered its worst month in more than seven years. Meanwhile, the U.S. says it wants to start work on a U.K. trade deal soon, while speculation in Britain mounts over who could be the next leader of the bruised opposition Labour Party. 

Stocks Climb

Asian shares climbed overnight, adding to gains in the U.S. where the S&P 500 index followed Europe’s lead by hitting a fresh record in the wake of the China trade deal. Bank of America says markets are primed for a “melt-up” next quarter, and there’s some optimism for Europe: The Goldman Sachs asset manager who foresaw this year’s rally in equities says investors are too pessimistic on Europe’s growth prospects. But it’s worth noting that data from Germany, and to an extent, France are not painting the best picture of the European economy. 

Boeing Halt

The aviation sector got a bit of a jolt as Boeing Co. announced  plans to halt production of its grounded 737 Max in January, a move that is likely to deepen the crisis engulfing the planemaker, complicate its eventual recovery and ripple through the sector. The indefinite shutdown will help the company conserve cash as pressure builds, with almost 400 new aircraft languishing in storage due to a global flying ban imposed nine months ago. Boeing shares fell the most in two months in New York.

French Stalemate

The stalemate between France’s government and its labor unions is showing few signs of abating as the country heads into a third week of transport strikes over President Emmanuel Macron’s efforts to reform its pension system, threatening more chaos during the busy Christmas period. Negotiations have been suspended, and complicating matters, Macron’s point man for pension reform resigned Monday after it was exposed that he failed to report multiple side jobs.

Coming Up…

We’ll get a U.S. industrial production reading after the weak numbers Monday in Europe, while for currency traders, the Hungarian central bank is seen making no change to its main interest rate. Elsewhere, the earnings schedule is light although German electronics retailer Ceconomy AG reports. 

What We’ve Been Reading

This is what’s caught our eye over the past 24 hours. 

To contact the editor responsible for this story: Phil Serafino at pserafino@bloomberg.net

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